CFA Institute supports broader access to private market investments in 401(k) plans while urging stronger fiduciary safeguards, enhanced participant disclosures, rigorous valuation and liquidity standards, and a phased approach to integrating private assets into retirement portfolios.
CFA Institute's comment letter on the U.S. Department of Labor's proposed rule for selecting designated investment alternatives in 401(k) plans supports an asset-neutral approach to private market investing while emphasizing stronger investor protections.
Key Recommendations Include:
• Strengthening fiduciary standards for valuation, liquidity, fees, benchmarking, and governance.
• Requiring participant-profile analysis, enhanced disclosures, and investor education.
• Addressing concerns that defined contribution investors may not receive the same private market benefits as institutional investors.
• Adopting a phased approach before allowing private market exposure in default retirement investment options.
The letter aims to balance innovation and broader investment access with ERISA's core principles of prudence, loyalty, and participant protection.